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[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 5127 Introduced in Senate (IS)]

<DOC>

118th CONGRESS
  2d Session
                                S. 5127

To amend the Securities Exchange Act of 1934 to require the Securities 
   and Exchange Commission to issue rules that prohibit officers and 
directors of certain companies from trading securities in anticipation 
              of a current report, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                           September 19, 2024

Mr. Van Hollen introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL

 
To amend the Securities Exchange Act of 1934 to require the Securities 
   and Exchange Commission to issue rules that prohibit officers and 
directors of certain companies from trading securities in anticipation 
              of a current report, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``8-K Trading Gap Act of 2024''.

SEC. 2. PROHIBITION ON CERTAIN TRADING IN ANTICIPATION OF A CURRENT 
              REPORT.

    The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) is 
amended by inserting after section 10D (15 U.S.C. 78j-4) the following:

``SEC. 10E. PROHIBITION ON CERTAIN TRADING IN ANTICIPATION OF A CURRENT 
              REPORT.

    ``(a) Prohibition.--Not later than 1 year after the date of 
enactment of this section, the Commission shall issue rules that 
require each issuer that is subject to reporting requirements under 
section 13(a) or 15(d) to establish and maintain policies, controls, 
and procedures that are reasonably designed to prohibit executive 
officers and directors of the issuer from purchasing, selling, or 
otherwise transferring any equity security of the issuer or interest in 
an equity security of the issuer, directly or indirectly--
            ``(1) with respect to an event described in any of sections 
        1 through 6 of the form described in section 249.308 of title 
        17, Code of Federal Regulations (referred to in this section as 
        `Form 8-K'), between--
                    ``(A) the occurrence of that event; and
                    ``(B) the filing or furnishing of a current report 
                on Form 8-K with respect to that event; and
            ``(2) with respect to an event described in section 7 or 8 
        of Form 8-K, between--
                    ``(A) the date on which the issuer determines that 
                the issuer will disclose that event; and
                    ``(B) the filing or furnishing of a current report 
                on Form 8-K with respect to that event.
    ``(b) Permissible Transactions.--In issuing rules under subsection 
(a), the Commission--
            ``(1) may exempt certain transactions that the Commission 
        determines are appropriate, including those transactions that--
                    ``(A) occur automatically;
                    ``(B) are made pursuant to an advance election; or
                    ``(C) except as provided in paragraph (2), involve 
                a purchase or sale of equity securities that satisfies 
                the conditions under section 240.10b5-1(c) of title 17, 
                Code of Federal Regulations;
            ``(2) may not exempt from those rules a transaction made by 
        an executive officer or director of an issuer under a plan 
        that--
                    ``(A) is described in section 240.10b5-
                1(c)(1)(i)(A)(3) of title 17, Code of Federal 
                Regulations; and
                    ``(B) was adopted--
                            ``(i) with respect to an event described in 
                        any of sections 1 through 6 of Form 8-K, 
                        between--
                                    ``(I) the occurrence of that event; 
                                and
                                    ``(II) the filing or furnishing of 
                                a current report on Form 8-K with 
                                respect to that event; and
                            ``(ii) with respect to an event described 
                        in section 7 or 8 of Form 8-K, between--
                                    ``(I) the date on which the issuer 
                                determines that the issuer will 
                                disclose that event; and
                                    ``(II) the filing or furnishing of 
                                a current report on Form 8-K with 
                                respect to that event; and
            ``(3) shall exempt from those rules--
                    ``(A) issuers required to adopt and administer a 
                code of ethics pursuant section 270.17j-1 of title 17, 
                Code of Federal Regulations;
                    ``(B) any other issuer registered under the 
                Investment Company Act of 1940 (15 U.S.C. 80a-1 et 
                seq.), the investment advisers of which are required to 
                adopt and administer a code of ethics pursuant to 
                section 275.204A-1 of title 17, Code of Federal 
                Regulations; and
                    ``(C) any event that is--
                            ``(i) described in any of sections 1 
                        through 6 of Form 8-K; and
                            ``(ii) announced by the issuer in a press 
                        release or other method of dissemination 
                        described in section 243.101(e)(2) of title 17, 
                        Code of Federal Regulations.
    ``(c) Foreign Issuers.--In issuing rules under subsection (a), the 
Commission may include foreign issuers required to use the form 
described in section 249.306 of title 17, Code of Federal Regulations.
    ``(d) Rule of Construction.--Each reference in this section to a 
provision of the Code of Federal Regulations (including each reference 
in this section to Form 8-K) shall be construed as a reference to that 
provision as in effect on the date of enactment of this section.''.
                                 <all>
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